Doctor pay and performance

Health-care costs continue to be both the big social and economic issue. One idea to moderate these costs is to tie doctors’ salaries to their performance records. But does the idea have merit? N.C. State University economist Mike Walden responds.

“We are … constantly looking for ways to moderate healthcare costs. And basically what happens today in a hospital or doctor’s office if they perform a particular procedure, they’re going to get a particular rate of remuneration. It’s not going to be tied to … whether the patient improved or whether the patient was able to overcome whatever their malady was. And some say that, hey, we ought to change that. We ought to tie what a doctor gets paid to how well the patient does.

“And proponents of this idea say that we should collect data on the success rate of doctors and link it to their payment. And they will argue, proponents will argue, that that will encourage doctors to … improve their treatments.

“Now you have another side of this. You have opponents saying no, no, no. First of all, they say it’s hard to say that how a patient’s outcome occurs is all due to what the doctor does. A lot of it may very well be due to the patient. So that would be unfair, they would argue, in linking what happens with a patient in tying the doctor’s pay only to that. Also they say that, look, it’s easy to say you can collect data. It’s very hard, however, to do that. And they also worry that if a doctor knows that their pay is going to be linked to an outcome that may … color or that may change how they … behave, maybe they won’t take risks that could turn out OK.

“So, this is a big debate that’s raging within the health-care area — one that we will watch very closely.”